The acquisition is seen as a move by Amazon to more aggressively target the grocery section of retail has proven more stubbornly resistant to digital channels. "Whole Foods Market has been satisfying, delighting and nourishing customers for almost four decades".
Earlier this week, the company announced that it plans to build a new facility in Colorado that will employ more than 1,500 full-time workers.
The deal valued at $13.7 billion unites the company that persuaded people to buy books - and then everything else - online with the grocery store chain that fell behind as shoppers found "good enough" alternatives to the organic and natural foods it helped popularize.
While news of the Amazon-Whole Foods deal sent shudders through the supermarket industry and Wall Street, at least one local grocer says Amazon's purchase wouldn't really change the competitive landscape.
Amazon is expected to thoroughly transform Whole Foods Stores, expanding them beyond being grocery stores to integrate them into their broader operations, perhaps including technology retail, and online-purchase ability. He's got professional respect for Amazon for how efficiently and successfully it runs its business.
More recently the company has deployed various physical retail concepts, some with the aim of making people comfortable with the concept of buying food from Amazon and eventually nudging them to move a big part of their grocery shopping online.
Costco, the wholesale club company, gave up $12.44, or 6.9 percent to end at $167.64.
Amazon has already made inroads into tackling the grocery market in the U.S. and UK.
Dylan: But there's definitely a lot more going on here than the fact that Whole Foods has 30 locations in MA. Whole Foods will keep operating stores under its name.
The deal brings to a head a years-long battle brewing between Amazon and traditional retail powerhouses such as Walmart. These three have begun offering some of what Whole Foods offers, forcing the supermarket chain to cut prices.
Whole Foods becomes a convenient place for Amazon customers to pick up items they ordered so they do not have to wait for delivery.
"This deal should leave no doubt that Amazon is deadly serious about dominating all aspects of retail", said Mr Paul Cuatrecasas, chief executive of Aquaa Partners, a London-based investment banking firm, in an e-mail. The website cited an opportunity for the company to buy another entity with the logistics expertise to fill that said gap.
Whole Foods has already been reducing prices to try to turn around its worst sales slump since going public in 1992.
It's not yet clear how its drone delivery program or Prime one-day delivery could change Whole Foods. Whole Foods CEO John Mackey had lambasted the hedge fund as "greedy bastards."